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Old 03-04-2008, 09:57 AM
 
Location: Happy wherever I am - Florida now
2,903 posts, read 6,965,039 times
Reputation: 2471
Face it, real estate prices have hit the wall. Based on Ichoro's excellent explanation of what's available in the way of payment leverage only serves to increase prices. The only way for them to continue to increase is with equity drawn from already owned properties rolled over into new ones.

We aren't going to put the kids out to work to continue to prop up inflationary real estate prices, nor are we likely going to get huge increases at work anytime soon. Interest rates aren't going to 0%, and banks have learned their lesson that if speculative owners don't have a foot in the deal they'll walk away at the first signs of not making a killing.

Prices will continue to drop to realistic levels that are affordable no matter what PR campaign is out there. Buyers have smartened up to the fact that being insulted by not putting in an offer over asking price only puts them at a disadvantage in the long run where homes had previously been looked at more as winning lottery tickets. Time to get real, and it's long overdue before it brings the whole country down trying to compensate, ie, descimating the value of the dollar and causing general inflation in order to ameliorate the RE bubble fallout. We all end up paying for others' greed.

Last edited by Sgoldie; 03-04-2008 at 10:32 AM..
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Old 03-04-2008, 10:51 AM
 
4,686 posts, read 3,403,522 times
Reputation: 1641
Quote:
Originally Posted by kturbe View Post
I do not disagree with NAR and I can only use my recent history. Bought in 95 for $113k sold in 2006 for $459k. Just like today's market there are ups and downs along the way but overall it is an excellent return.

In California we saw the following:
1968-1979 = 10.86%
1980-1989 = 7.95%
1990-1999 = .94%
2000-2006 = 12.29
Last 38 years average appreciation 7.75%

In Orange County
1970-1980 = 15.04%
1981-1990 = 9.43%
1991-1999 = .90%
2000-2006 = 13.07%

36 year average 9.76%

The other part of the NAR message is all real estate is local!
Any particular reason you're stopping your analysis in 2006? Is it related to the the 15-20% drop in prices in Orange County during the following year?

Last edited by KCfromNC; 03-04-2008 at 11:15 AM..
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Old 03-04-2008, 10:56 AM
 
30 posts, read 65,075 times
Reputation: 20
Perhaps it is true in CA/FL/NY, but certainly is not the case in my area. For example, my house (in a mid-size city with stable house market)

1982: sold for 88K
1992: sold for 103K
2000: sold for 133K

We are selling it right now after eight years and I would be happy to get 169K for it. The house value has not doubled in 25 years.
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Old 03-04-2008, 11:15 AM
 
4,686 posts, read 3,403,522 times
Reputation: 1641
Quote:
Originally Posted by Captain Bill View Post
I'm not defending anything, or anyone.

Someone said that doubling in price in 10 years could not be done.
Who, specifically?

Quote:
I'm showing a real life example that it was done. In fact as the example showed, it happened during (3) 10 year periods. It was being done in California and in many other places during that time.
Actually, your example didn't show that - it just showed that over a 36 year period it appreciated at an average of 7.8%. That appreciation wasn't steady - anyone who knows about CA real estate knows that the state goes through bubbles and busts every decade or so.

Anyway, my claim was that saying that "on average" prices double every 10 years is misleading. I know it's happened in some areas, just like I know that some homes have lost nearly 100% of their value over the same time. So pointing out 2 examples of places that have appreciated that much isn't disagreeing with anything I've said.

What I'd like to see is statistics showing that 7+% a year appreciation is the average nationwide. After all, this nonsense is coming from the NATIONAL Association of Realtors, not the "One Specific House in the Bay Area and Another in Ohio Association of Realtors".
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Old 03-04-2008, 04:29 PM
 
376 posts, read 1,006,109 times
Reputation: 160
Quote:
Originally Posted by KCfromNC View Post
Any particular reason you're stopping your analysis in 2006? Is it related to the the 15-20% drop in prices in Orange County during the following year?
No the reason I left 2007 off was because I did not have the numbers handy and had two appointments with buyers that I had to leave for. The decline for 2007 in O.C. was -10.3%

As I noted, my best example could only be with my home which more then doubled in the last 10 years.


The NAR ad clearly notes, all real estate is local.

KC I do not understand why you continuely try to prove everyone wrong on this board when the postings are asking for opinions.
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Old 03-04-2008, 08:12 PM
 
Location: NorCal, baby!
85 posts, read 186,691 times
Reputation: 66
Quote:
Originally Posted by kturbe View Post
The NAR ad clearly notes, all real estate is local.
That is NOT the thrust of the commercial mentioned in this post.

Quote:
Originally Posted by kturbe View Post
KC I do not understand why you continuely try to prove everyone wrong on this board when the postings are asking for opinions.
This post was not asking for an opinion, it was pointing out the deception of the NAR ad.

I don't think that KC is trying to prove EVERYONE (another typical and illogical generalization) wrong. KC points out some of the fallacies made by some real estate agents on here. When you make arguments based on certain premises (such as prices for areas over a period of time) it is not what is regarded as an opinion ("I like vanilla wafers" is an opinion). Hence, people have every right in the world to respond if you post your argument on a public forum...and even more so if it were only an opinion.

I guess it would be great in your little universe if real estate agents could just go on a board like this and say whatever they liked without being challenged. Maybe that is how it works at your real estate office, but not on this forum.
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Old 03-06-2008, 12:44 AM
 
101 posts, read 43,745 times
Reputation: 25
'with my home which more then doubled in the last 10 years. '


Gee could it possibly be because we experienced the biggest real estate bubble to date? Here is the memo: that was not a normal period of appreciation. Most homes in SoCal tripled in value since 2000. Now we are all giving back that paper equity and headed to normal appreciation. I wish people would study the history before they speak nonsense....
The New York Times > Week in Review > Image > Graphic: A History of Home Values
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